Fleming shares land in all-time trough

NEW YORK (CBS.MW) - Shares of Fleming surrendered Monday to the mishmash of disconcerting news that has surrounded the company in recent weeks.

The food distributor and grocer booted its chief executive amid a formal Securities and Exchange Commission investigation into accounting irregularities, has filed a number of prepetition claims against the bankrupt Kmart Corp., its one-time largest customer, and is in the throes of putting itself back together after losing Kmart.

Shares hit an all-time low of $.150 in intraday trading, but eased off a bit to close at $1.54 a share, off 23 cents, or 13 percent.

Meanwhile, Kmart
KMRTQ
pink sheets, trading over the counter, slipped to 12 cents. The stock will be worthless when Kmart comes out of bankruptcy at the end of the April.

Grocery stocks all over were hurting. Great Atlantic & Pacific Tea Co.
GAP, +2.89%
which last week amended its credit agreements with J. P. Morgan while it works around sales shortfalls, tumbled to its lowest point since going public in 1986 at $3.85. At last glance, shares stood at $4.22, off 8 cents, or 2 percent.

Safeway
SWY, +0.00%
shares slammed into a near seven-year low at $17.55, last changing hands at $17.59. Kroger
KR, +1.73%
due to report earnings Tuesday, fell 69 cents, or 5.4 percent, to $12.13. Food publications reported Monday that Kroger was among the leading bidders for Safeway's Dominick's chain in Chicago.

Albertson's
ABS, -0.22%
crashed too, hitting a nine-year bottom of $17.90 and ending at $17.92, off 58 cents, or 3.1 percent. The grocery store chain is scheduled to report earnings March 17.

Meanwhile, retailers are primed for weak sales this month after some key merchants reported that last week's sales results weren't pretty. At Wal-Mart and J.C. Penney, however, they were in line with the two retailers' internal expectations.

In their regular recorded calls spelling out the week's sales activity, both retailers noted that this month's results will be skewed because the Easter holiday fell in March last year.

Wal-Mart said it continues to look for this month's comparable-store sales to grow at a rate in a low single-digit range, improving to high single-digit comp-store growth in April. Last week's sales were strongest in electronics, food, pet supplies and intimate apparel, the mega-retailer said.

At J.C. Penney, meanwhile, home wares, women's accessories and men's wear were the big sales gainers. The department store retailer said same-store sales in March will be about even with or off slightly compared to last year.

At Big Lots, total Company same store sales for the first week of March were on plan, but the consolidators expects same-store sales to slide in the low single-digit range this month with total sales "essentially flat to last year," the company said.

Same-store sales for March's first week were "on plan," according to Big Lots. The best performing categories last week were domestics, furniture, and hardlines. Big Lots
BLI
shares ended the session at $11.05, off 25 cents, or 2.2 percent.

Also Monday, Federated Department Stores said on an unusually brief call that "our best guidance" for March same-store sales calls for a drop of 3 percent to 4 percent.

Sears Roebuck
S, -2.97%
backtracked 89 cents, or 4.5 percent, to $19.01. Sears said Monday that it is selling Lands' End apparel in 401 full-line stores after the successful launch of the departments in 10 key markets over the holidays. By the end of this year, the company will have Lands' End merchandise in all 870 stores, Sears said.

Sears claimed the test stepped up traffic and sales at some stores that exceeded fourth-quarter expectations. "In fact, the majority of the 183 Sears stores that carried Lands' End apparel saw sales accelerate at a faster pace than other Sears stores," the company said in a press release.

Also Monday, Crain's Chicago Business reported that Sears was set to open stand-alone prototype in Gurnee, Ill., northwest of Chicago.

The ratings agency cited May's declining same-store sales and loss of market share in its upscale segment, which includes such chains as Lord & Taylor and Hecht's. Moody's said it will be watching the retailer's plans to boost sales as well as its capital expenditures.

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